Veterans Administration (VA) Loans

The VA offers current and discharged Veterans some attractive loan options. First understand that the VA does not lend money but rather insures the Lender against losses in the event of a delinquency. You can purchase or refinance with a VA loan depending on your eligibility. The VA typically is more lenient on income qualifying and credit vs a Conventional or FHA loan. 100% financing is available up to the currently published FannieMae limits (currently $453,100 for 2018) and a down payment (25% of the amount above the limit) is required with purchase prices above this the published amount.

VA Funding Fee

The funding fee varies based on you classification of service and loan amount. Although VA has a funding fee that maybe financed on top of the loan amount and are usually cheaper than PMI & FHA fees. Here a recent estimate of the published fees:

Funding Fee Table for VA Purchase Loans for Regular Military Veterans

Service Down Payment First Use After First Use
Regular Military None 2.15% 3.3%%
5% or more 1.5% 1.5%
10% or more 1.25% 1.25%

Service Down Payment First Use After First Use
Reserves/Gaurd None 2.4% 3.3%
5% or more 1.75% 1.75%
10% or more 1.5% 1.5%

Eligibility – We will need your DD-214 or Certificate of Eligibility. Normally only veterans with honorable discharges are eligible for VA home loans.

Wartime - Service of 90 days or more, waived if applicant is discharged due to service-related disability.

Peacetime - Service of 181 days or more, waived if applicant is discharged due to service-related disability.

Reservist or National Guard - Service of at least 6 years.

Spousal Benefits of Deceased Veterans - Spouses of deceased service members may be eligible for VA loan benefit, provided they have not remarried and that the deceased died in service or from a service-related disability, was missing in action or a prisoner of war for at least 90 days or was determined as totally disabled and was eligible for disability compensation at the time of death. Children of deceased veterans typically are not eligible for VA mortgage loan benefits.

Loan Types - Primary residence only

Purchase - Available for 100% financing up to conforming limits

Refinance - Borrowers can refinance their homes with a VA streamline or VA cash-out loan. The streamline is also referred to as an “interest rate reduction refinance loan” (IRRRL), lowers the mortgage rate of an existing VA loan and if so the VA will waive much of the credit and appraisal underwriting process.

The Cash-Out Loan - Requires a credit report and appraisal.

Home Improvement - The VA allows for increases to purchase loans for the purpose of making renovations. The VA’s Energy Efficiency Mortgage program, for instance, lets borrowers add up to $6,000 to their home loan amount to install solar heating, insulation and storm windows, among other features.

Contact your VanDyk Mortgage Loan Originator to determine if a VA home loan is right for you!